Panama
Latin America Gateway
Panama: “Hub of the Americas”
•   Total Container Moves: 5.0 million TEU’s
     – Atlantic Ports
           • Evergreen
  ...
Colon Free Trade Zone
Colon Free Trade Zone


     0% Import Tax

     0% Export Tax

     0% Income Tax

     Time Limit on Storage: None

    ...
Colon Free Trade Zone


  2008 imports to the Colon Free Zone by CIF value
                                               ...
Colon Free Trade Zone


  2008 exports from the Colon Free Zone by FOB value
                                             ...
Imports & exports to/from the Colon Free Zone by value



       12000


       10000


        8000

                    ...
Warehousing & Distribution



     97,000 m2 Total Warehouse Space

     24,000 m2 Under Construction (2009)

     20,000 ...
MIT Logistics Park
MIT Logistics Park


     Built to US Standards
     86,000 m2 warehouse space
     Fire Suppression/Prevention System
   ...
Technology
Technology


     WMS Features: Bar Code, Locations, WiFi

     Inventory Controls: Cycle Counts, Wall to Wall

     Perfo...
Website Integration Service


     Customized Website Design &
     Operation
     On site engineers and support
     pers...
Value Proposition
Existing Distribution Network in Latin America


                                                                      Ori...
Possible Distribution Network in Latin America


                                                                   Origin...
Regional Inventories vs. Local Inventories

 As is Model                                               To Be Model using a...
Existing DHL Clients

  Electronics



  Consumer




  Pharmaceutical




  Fast Moving Consumer Goods (FMCG)
DHL Global Forwarding
Questions and Anwers
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Surse Pierpoint, Colon Free Zone Users Association, 2nd Vice President

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Surse Pierpoint, Colon Free Zone Users Association, 2nd Vice President

  1. 1. Panama Latin America Gateway
  2. 2. Panama: “Hub of the Americas” • Total Container Moves: 5.0 million TEU’s – Atlantic Ports • Evergreen • Hutchinson Industrial Zones • Manzanillo International Terminal Proposal ofInstalations I. H TechC orateZonean A igh orp d ggregated V e alu – Pacific Ports II. C stru sfor M ltipleU and on ction u sers In batorsfor N U cu ew sers • Hutchinson III. H TechL isticsw Em asisin igh og ith ph A T sp erial ran ortation • Tocumen Int’l Airport IV. Trad al an Log ition d isticsDistribution VI. H yM ltim alLogistics eav u od – COPA / Continental Airlines VII. E sionof Tradition O eration inthe xpan al p s C lonFreeZon o e – DHL Hub Futuredevelop ent w P R m ith C C – FedEx Hub IIIo. H T M ltim dal L istics igh ech u o og V Fu reE sionfo T ckTerm al o. tu xpan r ru in – UPS Hub V H M ltim Io. eavy u odalLogistics • Colon Free Trade Zone Expansion • Multi Modal facilities Copyright by A P R C N U IN V N AG bH IR O T O S LT G IE N m . – Rail System – Inter Oceanic Highway – Port Expansion – Free Zone Expansion
  3. 3. Colon Free Trade Zone
  4. 4. Colon Free Trade Zone 0% Import Tax 0% Export Tax 0% Income Tax Time Limit on Storage: None Port-Warehouse: Integrated Customs Brokerage:1 hour maximum Country of Origin: Unchanged Legal Status: Foreign and Local Companies
  5. 5. Colon Free Trade Zone 2008 imports to the Colon Free Zone by CIF value Country of origin HONG KONG Imports: US$8,500MM JAPAN 8.8% 3.9% UNITED STATES 2.5% SOUTH KOREA TAIWAN 11.6% ITALY 18.6% SINGAPORE FRANCE 1.5% SWITZERLAND 0.8% 2.0% THAILAND CHINA UNITED KINGDOM 1.9% OTHERS 1.5% 18.9% 26.8% 1.2%
  6. 6. Colon Free Trade Zone 2008 exports from the Colon Free Zone by FOB value Country of destination COLOMBIA Exports: US$9,000MM ECUADOR PANAMA 7.3% VENEZUELA 4.5% UNITED STATES HONDURAS 20.2% CHILE EL SALVADOR 15.9% MEXICO BRASIL COSTA RICA GUATEMALA 3.6% NICARAGUA CUBA DOMINICAN REPUBLIC OTHERS 3.0% 2.0% 2.7% 16.5% 2.3% 2.0% 4.6% 5.4%1.6% 2.9% 5.3%
  7. 7. Imports & exports to/from the Colon Free Zone by value 12000 10000 8000 Import 6000 Export 4000 2000 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Import 4661.3 5390 5211.9 4039.1 4464.6 4607 4218.5 4004 5075.3 6215.7 6753.1 7625 9335.7 Export 5523.6 6274 5985.2 4938.2 5299.6 5382.9 4843.9 4583.1 5473.6 6661.8 7604.2 8534.9 9874.2 7
  8. 8. Warehousing & Distribution 97,000 m2 Total Warehouse Space 24,000 m2 Under Construction (2009) 20,000 m2 Climate Controlled (25ºC) 600 m2 Cold Room (5ºC) Consumer Electronics (40%) Pharmaceutical (30%) Cross Dock (25%) Cold Chain (5%) Value Added
  9. 9. MIT Logistics Park
  10. 10. MIT Logistics Park Built to US Standards 86,000 m2 warehouse space Fire Suppression/Prevention System High Density Racking/Cross Dock Climate Controlled Storage (25ºC) Cold Storage (5ºC) Product Conditioning/Rework Areas Private Container Yard 24 Hour Survillance (Electronic/Guards) Electric Fork Trucks
  11. 11. Technology
  12. 12. Technology WMS Features: Bar Code, Locations, WiFi Inventory Controls: Cycle Counts, Wall to Wall Performance: Picks per HR, Loading, Unloading EDI Capabilities: Communicate with outside systems (SAP, JDE, BPX, BAAN, Legacy Systems) Internet Integration: Inventories, Orders, Custom Reports On-Line Documents Order Entry: Website for order entry (end customer/regional office)
  13. 13. Website Integration Service Customized Website Design & Operation On site engineers and support personnel 24/7 order processing Order pre-processing Process WorkFlow controls Automated messaging and e-mail alerts Link warehouse information to sales team in with one website Integrate with SAP, JDE, Oracle, SUN, Legacy, etc. Order track & Trace
  14. 14. Value Proposition
  15. 15. Existing Distribution Network in Latin America Origin Data Chargeable Number of weight (kg) Shipments MX 384,422.50 461 NL 359,590.00 344 CR 220,222.50 422 US 35,002.00 221 FR 7,162.00 31 GB 3,547.50 11 AR 2,640.00 4 SG 1,384.00 1 PK 817.00 2 IE 632.50 7 CA 211.50 1 BR 141.50 2 Main shipping origins are US, Total Shipments Inbound CN 56.00 1 NL , MX and CR. The current 400 200 PE 5.00 1 distribution flow is composed of 0 Total many lanes and lacking cost Main Origins (# of shipments) chargeable 1,015,834.00 1,509.00 400 – 500 weight improvement opportunities 300 – 400 200 - 300 achieved through consolidation.
  16. 16. Possible Distribution Network in Latin America Origin Data Chargeable Number of weight (kg) Shipments MX 384,422.50 461 NL 359,590.00 344 CR 220,222.50 422 US 35,002.00 221 FR 7,162.00 31 GB 3,547.50 11 AR 2,640.00 4 SG 1,384.00 1 PK 817.00 2 IE 632.50 7 The LATAM market could CA 211.50 1 be divided into three main BR 141.50 2 Total Shipments Inbound receiving regions, Mexico, 400 CN 56.00 1 Brazil and Panama. Brazil 200 PE 5.00 1 and Mexico will attend their 0 Total Main Origins (# of shipments) chargeable 1,015,834.00 1,509.00 own markets and Panama will 400 – 500 weight provide product to the other 300 – 400 200 - 300 main countries in the region.
  17. 17. Regional Inventories vs. Local Inventories As is Model To Be Model using a Regional Hub • Supply Chain: Direct from Plants in Europe, USA, • Distribution Center in Colon Free Trade Zone in Mexico & Brazil to Customers Panama • Lead Time from every mnf. point: 4 – 6 weeks • Customer Purchase Order to Delivery time: 2-7 days Problems: • Inaccurate forecasting Solutions: • Different packaging requirements for products per • Standard packing for the region countries or customers • Regional Inventory planning • Small production runs delay delivery times • Freight reduction using sea - air • Higher freight for smaller shipments • Immediate reaction to market changes • Reaction time to market: very slow with low • Flexibility of inventory allocation per country visibility of supply chain (poor service level) • Product Conditioning according to customer’s • Creates stock-outs &/or excess inventory needs situations • Less inventory requirements per country • Non-compliance with bid requirements • Reduction of import and nationalization cost • Stiff penalties by government institutions • Lower risk of financial impact from currency • Need for high levels of inventory in each country fluctuation • Customer credits for expired goods • Capacity of local deliveries to point of sale • High Write off for inventory obsolescence bypassing local distributors • Total control and visibility of the supply chain
  18. 18. Existing DHL Clients Electronics Consumer Pharmaceutical Fast Moving Consumer Goods (FMCG)
  19. 19. DHL Global Forwarding Questions and Anwers

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